If Big Oil Drowns Trump, Green Energy Could Cast Him A Lifeline

In this Jan. 13, 2017, photo, President-elect Donald Trump speaks with reporters in the lobby of Trump Tower in New York. Trump’s meetings this week with CEOs seeking federal approval for major mergers are raising red flags for ethics lawyers concerned that about the possible erosion of a firewall between the regulators tasked with approving the billion-dollar deals and the White House. (AP Photo/Evan Vucci)

As President-elect Donald Trump plans to take the oath of office on Friday January 20, he will be coming to Washington with a cloud over his head. Some are questioning his legitimacy — not just to his victory in the Electoral College but also with respect to the energy policies that he has been espousing.

The natural extension of a vitriolic campaign has undoubtedly led to the acrimony now present in the political atmosphere — a raw sentiment targeted right at Trump. That feeling will assuredly impede whatever agenda the president-elect has in mind, including his aggressive ideas aimed at lessening the nation’s use of renewables and limiting the U.S. role in mitigating climate change.

President Obama has implored the President-elect to think more broadly and to not succumb to the loudest voices representing the traditional energy sources: Businesses such as General Motors, Hewlett Packard and Johnson &Johnson are prospering both financially and environmentally from green investments.

At the same time, energy gurus like T. Boone Pickens are weighing in, advising Trump not to turn his back on new energies. While Pickens knows that oil and gas will remain lynchpins of the American economy, he has essentially told the president-elect to steer the middle ground. In a previous talk with this writer, he said that natural gas is a critical pathway to carbon reductions and that the country ought to export hydraulic fracturing technologies while also working to grow its domestic green industry— positions similar to those of Obama.

“The United States is showing that [greenhouse gas] mitigation need not conflict with economic growth,” the president wrote in the journal Science. “Rather, it can boost efficiency, productivity, and innovation. Businesses are coming to the conclusion that reducing emissions is not just good for the environment — it can also boost bottom lines, cut costs for consumers, and deliver returns for shareholders.”

Indeed, the International Energy Agency in Paris found that the world’s emissions remained flat in 2014 and 2015 even as GDP continued to grow by more than 3% in each year. In this country, more than 24,000 megawatts were added to the grid in 2016, notes the U.S. Energy Information Administration. Half that — for three years running — has been wind and solar energies.

Money to Spend

On a practical level, the Department of Energy has about $40 billion left in its loan kitty. While renewable generation has been the primary beneficiary of those loans, the money could go to other things such as advanced coal technologies. So far, the program has loaned about $22 billion while collecting $3.5 billion in repayments and $810 million in interest. Defaults have amounted to about $750 million, which has been mostly attributed to Solyndra that lost $535 million.

“We invested in a solar company, our country,” Trump said during a debate with Hillary Clinton. “That was a disaster. They lost plenty of money on that one. … Now, look, I’m a great believer in all forms of energy, but we’re putting a lot of people out of work. Our energy policies are a disaster.”

If Trump genuinely believes the current energy policies are a failure, he will follow through on his pledge to kill this country’s efforts to cut carbon emissions by trying to invalidate the Clean Power Plan and by withdrawing from the global climate accords. To that end, the president-elect has culled from the ranks of climate skeptics and tapped into the Institute for Energy Research, whose executive director Thomas Pyle has been helping to form the new Energy Department.

A story in the Los Angeles Times says that Pyle tried to stop federal involvement in such energy projects as Ivanpah, which is a 392-megawatt concentrated solar energy project that is delivering power to PG&E Corp. and Edison International. It is a joint venture among NRG Energy, Google and Brightsource Energy. The deal relied heavily on Energy Department funding — monies that Pyle’s group thinks of as wasted on a boondoggle project.

Meanwhile, the same LA Times story says that the institute has repeatedly referenced a study that has been proven faulty and one that looks at Spain’s experience with renewables: For every one green energy job gained, the institute says that two other jobs are lost. The Spanish government continues to protest that characterization while it points out the fallacies of its evaluation.

Meantime, Trump’s pick to head the Environmental Protection Agency is already one of the agency’s leading antagonists and he also questions the validity of the prevailing climate science. He is suing to stop any advancement of the Clean Power Plan while also doing the same regarding the Obama administration’s plans to curb methane releases from oil and gas drilling. If approved by the Senate, Scott Pruitt’s EPA could weaken the regulatory environment by acts of omission, or simply refusing to defend regulations in court.

“The Obama Climate Action Plan is about restricting access to America’s vast resources of coal and natural gas, which together supply approximately two-thirds of our nation’s affordable electricity,” Pyle has previously said. Economic progress is paramount here, he emphasizes.

Defining the Threat

But even the oil companies that Pyle’s group represents are diversifying their holdings and expanding into renewables and green technologies. Part of that is because oil prices are low and part is because of the pressures they are getting from environmentalists. But those companies would not buck the interest of their shareholders if they didn’t think the investments would pay off.

Consider that Total of France has already spent $1.4 billion buying SunPower while it said in 2016 it would buy battery maker Saft for $1 billion. Royal Dutch Shell, meantime, has formed Shell New Energies that will invest $200 million a year on green technologies. And ExxonMobil Corp. also said last year that it would explore carbon capture and sequestration with a fuel cell company.

To that end, President-elect Trump’s pick to head the US Department of State said that the United States should stay involved in the Paris climate accord. As the former chief executive of Exxon, Rex Tillerson has come around and said that fossil fuels contribute to man-made climate change, although he did tell Congress last week that trying to tackle the issue unilaterally would put the nation at an economic disadvantage.

“No one country is going to solve this alone,” Tillerson testified. “I think we’re better served by being at the table than leaving the table,” referring to the global climate accord signed in December 2015 in Paris.

On the surface, it would appear that Trump has boxed himself in and taken hardline positions counter to those that have gained traction under President Obama. But behind the scenes, some of those advising him are telling him not to block such progress — including members of his own party, whose states have benefited from the New Energy Economy.

His positions change daily. But the political framework is now established, which is that Trump lost the popular election by 3 million votes and that many Americans view him as a threat to democracy. Maintaining rigid positions will only further alienate him, meaning that he must curb the inflammatory rhetoric or else see further aspersions cast on his legitimacy.